Market researcher predicts "gold rush" for car traction batteries

June 25, 2012 //
By Christoph Hammerschmidt

Over the next decade, the market for car traction battery packs will explode from $4.8 billion to $54.2 billion, predicts a report from market research and consultant company IDTechEx. This huge emerging market has triggered efforts to create a $10 billion traction battery company and a "gold rush" to obtain the key materials.

We are in the decade of the hybrid vehicle in terms of market value and the pure electric vehicle in terms of numbers, writes IDTechEx Technology Analyst Harry Zervos in the study. Users demand greater all-electric range from both of them. Consequently, their battery needs are converging now that the particular need of hybrids of good cycle life and fast charge discharge (energy density) is overcome with the rapid move to lithium-ion batteries.

There are three generations of lithium-ion traction batteries in use today, with the second generation being most popular. These generations represent different ways of managing the safety/performance/price compromise as shown below. As there is no inherently safe lithium-ion cell, safety is an on-going concern.

In order to give a car 200km of electric range, a 40kWh battery weighing 400kg is necessary. Such a huge, heavy device is not fitted into a car. The car is designed around it. The battery is the car. Indeed, the cost of hybrid car traction battery packs will increase as they transition from mild hybrids to range enhanced series plug-in hybrids that exceed the performance of mainstream conventional cars in parameters such as range. In ten years, the value of the traction battery may have risen from 27% to 57% of the ex-factory price of the car as a whole.

Market forecasts for traction batteries for cars will be affected by many changing factors over the next ten years. Firstly, the capacity of battery differs greatly: no more than a few kWh for a golf car, 2-16 KWh for a typical hybrid and 20-60 kWh for a pure electric vehicle. Batteries for hybrids have to survive many rapid discharges. Batteries for pure electric cars must store more energy and do it for